Transcontinental: Competition Bureau uses Consent Agreement to Test Failing Firm Analysis

Author: Charles Tingley

On May 28, 2014 the Competition Bureau announced that it had reached a consent agreement with Transcontinental relating to its proposed acquisition of 74 community newspapers from Quebecor Media. The objective of the consent agreement was to preserve competition in the sale of advertising in community newspapers in the Province of Québec by requiring that a number of the parties’ newspapers be put up for sale.

This article by Charles Tingley discusses what this settlement indicates about how the Bureau might in future be prepared to approach failing firm analysis when reviewing whether a proposed merger is likely to lessen competition substantially. That approach could create uncertainty for purchasers and vendors about when and how the Bureau will test claims about the financial distress of takeover targets and the absence of competitively preferable purchasers to acquire them.

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